Thursday, December 22, 2005

Law_Bank regulator via Court

Could you imagine one day SEC, the U.S. denominate banking regulator, asked the court to reconsider the ruling on the bank it regulated? You could be laugh on that, coz it will never happen.

But, that's happening in China. CBRC, China Banking Regualtory Commission, sent a formal letter to the high court, asking to revise the court's ruling related with Agricultural Bank of China.

In 2001, a poor farm applied for the 2-million-yuan loan from a branch of ABC, but it claimed that it hasn't got the reply "in time", which has brought huge loses on its business. The high court, when the farm sued the second time, ruled that the ABC branch should pay for the farm's loss.

ABC,the long-history government money firm, was angry and then filed to its regulator, CSRC, to ask for the explanation on the loan regulation. CSRC, then, sent a formal letter with four reasons to ask the high court to renew its ruling.

The point is not on who should win, but on who should decide how to implement the law. Does CSRC, though as the one who helps making the loan law before, have the right to ask the judges, who implement the law, to revise the already-made decision? CSRC is powerful, of course, but that doesn't mean it could have the rights to be the judges. It may have the right to not agree on the ruling, and it could ask the revision on the regulation to make it more clear. The right process is to revise the law first via the normal law-making procedure. Currently, it has to obey the court, however decision judges make.

The most important factor for a balanced and open society is the power restrictment on each social body. Not a single body could have unlimited power. That's what law means to the people in the society. But here, we see, some bad example.

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